Multiple choice

A company sends its cars to dealers on 'Sale or Return' basis. All such transactions are however treated like actual sales and are passed through the sales per day book. Just before the end of the financial year two cars which cost Rs. 50, 000 each have been sent on 'Sale or Return' and have been debited to customers at Rs. 60, 000 each, cost of goods lying with the customers will be

  1. Rs. 1, 00, 000

  2. Rs. 1, 20, 000

  3. Rs. 60, 000

  4. none of these

Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

 When the goods are sent on Approval Basis, vaue of goods is recorded at cost.